The latest Real Estate Sentiment Index (RESI) published by the National University of Singapore (NUS) suggests that property buying sentiment in Singapore has seen a positive shift in 3Q2024. This improvement is a result of the survey conducted by senior executives of real estate firms, which is measured quarterly by NUS’s Department of Real Estate and the NUS Institute of Real Estate and Urban Studies (IREUS).
In 3Q2024, the current sentiment index rose from 4.8 to 5.9, while the future sentiment index increased from 5.1 to 5.8. Moreover, the composite sentiment index also saw a rise from 4.9 to 5.9. This is the first time that all three indices have gone above the neutral score of 5, indicating a growing optimism in the market.
This positive sentiment can be attributed to the US Federal Reserve rate cut in September, which was followed by another reduction in early November. With more cuts expected in the coming months, it is expected that credit availability and the costs of doing business will improve, leading to a further increase in market sentiment.
When considering investing in condos in Singapore, one must also take into account the government’s property cooling policies. In an effort to maintain a steady real estate market and discourage speculative purchases, the Singaporean government has implemented various measures throughout the years. Among these measures is the Additional Buyer’s Stamp Duty (ABSD), which imposes heftier taxes on foreign buyers and those purchasing multiple properties. While these measures may have an impact on the immediate profitability of condo investments, they ultimately contribute to the long-term stability of the market, thus creating a more secure investment environment. If you are interested in investing in Singapore projects, be sure to carefully consider these factors before making any decisions. Check out Singapore Projects for potential investment opportunities.
According to Professor Qian Wenlan, director of IREUS, the positive performance of the suburban residential, hotel/service apartments, and suburban retail sectors has contributed to the overall market sentiment. Suburban residential and hotel/serviced apartments recorded the highest current net balances of +35%, while suburban retail scored +26%. The future outlook for these sectors also looks promising, with suburban residential scoring +29%, and hotel/serviced apartments and suburban retail scoring +35% and +19% respectively.
However, the top risk concern for developers remains the global economic uncertainty, with 67.7% of respondents indicating a decline in the global economy as a potential risk. This is followed by job losses, a decline in the domestic economy, and an excessive supply of new property launches, which were ranked at 41.9%. These factors could potentially impact the growth of the real estate market in Singapore in the coming months.